The United States may impose trade sanctions on China. It feels China’s intellectual property laws are unreasonable and discriminatory and harm American intellectual property, innovation and technology. The US could take its case to the World Trade Organization or settle it outside.

Under Section 301 of the US Trade Act 1974, the United States can impose trade sanctions on foreign countries that either violate trade agreements or engage in other unfair trade practices. A US trade sanction against China was long in the offing, consistent with Donald Trump’s election promises of cutting America’s ballooning trade deficit with China and punish the Asian nation for policies and unfair trade practices such as artificially keeping its currency depressed to boost exports. The United States estimates theft of intellectual property costs the American economy 600 billion dollars a year, and feels China is a major contributor, employing unfair trade practices and industrial policies such as forced technology transfer, which are damaging.

American companies say they are being unfairly forced to enter into joint ventures with Chinese companies if they want to do business in China and also, as part of these joint ventures, have to turn over their intellectual and other proprietary information.